By 6-5 vote, Worcester tax bills to go up 4.1%

WORCESTER — Single-family homeowners and business property owners will share an equal burden in the percentage increase in their annual real estate taxes for this fiscal year.

The City Council Tuesday night adopted a set of fiscal 2014 tax rates — $19.54 per $1,000 valuation for residential and $30.83 for commercial-industrial — that will increase the annual tax bills for both classes by roughly 4.1 percent.

The rates adopted by the council, by a 6-5 vote, were a compromise between what had been sought by the Worcester Regional Chamber of Commerce and those who advocated for a more favorable residential tax rate.

For single-family homeowners, the new tax rates translate into a tax increase of $133, based on the median single-family assessed value of $171,300. The median residential tax bill will be $3,347 for this year.

At the same time, the percentage increases will be greater for condominiums (9.1 percent), two-family homes (7.6 percent) and three-family homes (5.4 percent), according to city assessors.

Those percentage increases are greater for those classes of property because their assessments increased during the past year, while assessments for single-family homes dropped slightly.

Meanwhile, the average annual tax bills for commercial and industrial properties will be going up by $332, on average, according to city assessors.

That is based on a median assessed value of $273,000 for commercial-industrial properties.

The median commercial tax bill for this fiscal year will be $8,417.

Councilor-at-Large Frederick C. Rushton said the rates adopted by the council signal that Worcester is a city on the move and that its homeowners and business property owners are willing to share an equal burden when it comes to this year's tax increase.

"We need to work together to build this city's tax base," Mr. Rushton said.

The tax rates for the previous fiscal year were $18.58 for residential and $30.85 for commercial-industrial.

The Worcester Regional Chamber of Commerce and local business leaders pushed for a set of tax rates — $19.77 for residential and $30.24 for commercial-industrial — that further closed the wide gap that has existed between the two rates for many years.

Ms. Toomey said tax classification is always a difficult subject for the council to deal with.

She said she understands the concerns and angst that homeowners have when it comes to the tax rates, but added that the city needs to have tax rates that also encourage new job growth.

Mr. Economou, meanwhile, argued that the city's tax structure, in which more of the tax burden has been shifted to business property owners, has eroded the business tax base.

He pointed out that commercial and industrial properties accounted for 40 percent of the city's tax base before the City Council adopted split tax rates in 1984.

Today, he said, business properties account for only 28 percent of the tax base.